India s Q3 CAD widens to $13.5 bn (Lead)

Mumbai March 16 (IANS) India s current account deficit (CAD) widened to $13.5 billion during the third quarter of 2017-18 from $7.2 billion in the second quarter and $8 billion in the corresponding period in 2016-17 Reserve Bank of India (RBI) data showed on Friday.

"India s CAD at $13.5 billion (2 per cent of GDP) in Q3 of 2017-18 increased from $8 billion (1.4 per cent of GDP) in Q3 of 2016-17 and $7.2 billion (1.1 per cent of GDP) in the preceding quarter " the RBI said.

"The widening of the CAD on a year-on-year (y-o-y) basis was primarily on account of a higher trade deficit ($44.1 billion) brought about by a larger increase in merchandise imports relative to exports."

According to the RBI net services receipts increased by 17.8 per cent on a y-o-y basis mainly on the back of a rise in net earnings from software services and travel receipts.

"Private transfer receipts mainly representing remittances by Indians employed overseas amounted to $17.6 billion increasing by 16 per cent from their level a year ago " the RBI said.

"In the financial account net foreign direct investment at $4.3 billion in Q3 of 2017-18 was lower than US$ 9.7 billion in Q3 of 2016-17. Portfolio investment recorded net inflow of $5.3 billion in Q3 of 2017-18 - as against an outflow of $11.3 billion in Q3 last year - on account of net purchases in both the debt and equity markets."

The RBI added that in Q3 2017-18 there was an accretion of $ 9.4 billion to the foreign exchange reserves (on BoP basis) as against depletion of $1.2 billion in Q3 of 2016-17.

--IANS
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